Your Business May Be Failing: 20 Reasons Why and What to Do About It

It’s a reality all entrepreneurs must come to terms with: the potential for failure. Over 51% of businesses will fail in their first five years (U.S. Census data), and even 25–30% of venture-backed businesses fail. If you want to innovate and put yourself out there, you have to accept that every entrepreneurial venture is a risk.

But how can you reduce that risk of failure for your next startup?

Often, it helps to turn to the experience of others, to learn what lessons we can from their failures, and cut the learning curve for ourselves. Even if you feel like you’re reaching (or surpassing) your prime, it’s never too late! Jeffrey Brotman, founder of Costco, didn’t launch that successful company until he was into his forties.

Others might surprise you. I know I was surprised that disharmony on the team or with investors was a top cause for failure. We don’t like to think interpersonal issues like that are unresolvable to the extent the company fails, but it seems that happens more often than I realized.

Startup Failure Reasons

Use these insights to evaluate your own startup strategy and make sure you’re staying away from known problem areas. See if you were aware of each of these potential pitfalls, in the Top 20 Reasons Startups Fail: